After Dewey & LeBoeuf, It's Lawyers v. Lawyers

Creditors waiting to know if and when they will get paid by Dewey & LeBoeuf may want to consult the case of Coudert Brothers, the law firm that filed for bankruptcy in 2006. Nearly six years later lawsuits related to its collapse are still wending their way through the courts, with a federal judge ruling on May 24 that former partners may be on the hook for revenue from cases they took with them to their new jobs.

Unwinding Dewey, which filed for protection from creditors on May 28, marking the biggest bankruptcy in the legal business, probably will be even more complex. The product of a 2007 merger between Dewey Ballantine and LeBoeuf, Lamb, Greene & MacRae, the mega-practice at one point had more than 1,300 attorneys spanning 12 countries. The firm, based in New York, fell apart in a matter of weeks this year after ousting its chairman and watching at least 250 of its 304 partners decamp to competing firms. “I wouldn’t be surprised if the wind down took a minimum of six to seven years,” says Edwin Reeser, a former managing partner for the Los Angeles office of Sonnenschein Nath & Rosenthal. “It could take 10.”